Division of property in a divorce is a complex process. Aside from the emotional challenges that you must go through, there is also a state of uncertainty over how you and your spouse can both protect your respective financial interests.
By understanding what types of debts are divided and which debts are considered separate, you can navigate the process better and recognize the liabilities involved.
How is marital debt divided?
Illinois law uses equitable distribution to determine property division in a divorce. This model aims to divide the couple’s marital assets and debts in a manner that is fair and just, but not necessarily equal.
To help establish fair distribution in marital debt, the court will evaluate each spouse based on the following:
- Age, health and education
- Income or property brought to the marriage
- Future employability and earning opportunities
- Current and future financial needs
The court will also assess the purpose of the debt and who would be most suitable to handle it after the divorce.
3 common forms of marital debts
Marital debt refers to any debt acquired by either spouse during the marriage and for the benefit of their family, with some exceptions.
Mortgages: The family home often holds a significant amount of debt. To help manage this, the divorcing couple will settle on whether one spouse will keep the house and assume its mortgage payments, both will continue as co-owners and continue to pay it together or they will sell it.
Credit card debt: This will depend on whether the credit card was used to purchase an individual expense or a joint expense. Any household expense is a marital expense. For these debts, they will be split equitably between spouses. On the other hand, any individual expense is generally considered as individual debt. In this regard, if one spouse uses their card to purchase a gift for their spouse, this will be viewed as such.
Car loans: The court will generally assign the remaining car loan to the spouse who will keep the vehicle. However, if neither spouse wants to keep the car, they can agree to sell it and use the proceeds to pay off their car loan.
Asking for help is not a sign of weakness
Divorce can be a challenging process to navigate on your own. By understanding how marital debts are divided in Illinois, you can embrace the complexity of the process and carry on with your divorce proceedings with confidence.